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We are an aging population and the legal concerns of seniors are ever mounting. At Zammitti Law, PLLC, we face these issues head on by discussing concerns relative to long term care and special needs at the very first meeting. A proactive approach with a knowledgeable elder attorney can help protect your individual well-being and the assets you have worked your life to achieve.

Brief Facts:

According to the More than U.S. Dept of Health and Human Services Survey, 70% of Americans over age 65 will need long-term care services at some point in their lives.

• Median Cost for Home Health Aide in NY is $4,400 per month ($52,800 per year)

• Average Cost for Nursing Home Care in Orange County area is $11,500 per month ($138,000/yr)

Government Assistance – Medicaid

• NY Resource Allowance (2018): $15,150 o Maximum spousal allowance: $123,600

• NY Income Allowance (2018): $842/month o Certain additional allowances for “reasonable” living expenses and spouses Anything above these limits would be spent down without further planning

Allowable Expenses & Other Transfers

• Certain purchases such as a car or home improvements are allowable for Medicaid purposes and do not count as a transfer upon applying for government assistance.

• The Medicaid LOOK BACK period for transfers when applying for facility care coverage is 5 YEARS! This means a gift today will be considered an available resource if you apply for Medicaid within five years.

How Best to “Gift” Your Assets Now

Using your home as an example, you could either gift your non-mortgaged property to your children outright or use a vehicle whereby the gift of your house is received by your beneficiaries only after your passing (ie. an irrevocable trust). The differences are as follows:

• Outright Gifts – transfer house to kids

- Starts the 5 year lookback period

- Not as safe or flexible as using an irrevocable trust

• Irrevocable Trust – transfer house to trust o Starts the 5 year lookback period

- Protects your home from any creditors of your beneficiaries

- Ensures your right to reside in your home for your lifetime

- Maintains your property tax rebates & discounts

- Includes the asset in your estate to minimize capital gains liability due from your beneficiaries at a future sale

Citizen Friendly Laws in New York

The fear of spending down your assets is real, but luckily the State of New York has several laws to assist with the avoidance of this scary prospect.

Shorter Look-Back Period for Community Care: If you are able to receive care in a residence (whether it is your home or someone else’s home), the period of time Medicaid will consider when reviewing your resources is no longer five years, but 1 month. Spousal Refusal:

If you are married and one spouse becomes ill requiring care, it is possible to transfer the assets to the community spouse and obtain Medicaid coverage by “refusing” to provide support for medical expenses. Keep in mind, however, that the state has the option to attempt to recover from the spouse. ​

First, ask yourself 5 essential questions:

1. Do you have a guardian named for your minor children?

2. Have you protected your assets from long term care costs?

3. Are you minimizing your tax liability?

4. Do you have a designated agent for health care or financial purposes to make decisions if you cannot?

5. Have you reviewed your estate plan in the last three years?

If you answered NO to any of these questions or you are UNSURE, now is the time to learn more.

WHAT IS A REVOCABLE TRUST?

A contractual agreement established by you as creator (Trustor) and manager (Trustee) of the assets held by the trust. You can amend this agreement during your life. At either incapacity or death, the trust directs your wishes for treatment of your assets.

WHAT IS A WILL?

A written document conveying your wishes for the division of your estate assets at death.

WHICH PLAN IS BEST FOR YOU?

It depends on your specific family and estate circumstances. The following factors must be considered:

• Size of your estate (ie. value of all assets, including your home)

• Location of real property (resident state only or multiple states)

• Ownership of retirement and/or life insurance assets

• Family dynamics

• Specificity & uniqueness of wishes.

*This list is not entirely inclusive of all possible relevant factors.

The prospect of dealing with finances after the passing of a loved one is extremely daunting. At Zammitti Law, PLLC we take the burdens of this process off your shoulders and assist with each aspect in a controlled and efficient manner. There are three general goals for a successful estate/trust administration:

1. Collection and management of assets

2. Payment of debts, expenses and taxes

3. Distribution of net assets to the named beneficiaries.

IMPORTANT NOTE: It is not uncommon for an estate/trust administration to take over a year to complete given the above processes and need for tax filings, etc.

Responsibilities of a Fiduciary Executor/Executrix:

• Officially obtain assignment through probate action in Surrogate’s Court

• Collect decedent’s assets after death

• Pay valid creditor’s claims and other liabilities of the probate estate

• File an Inventory of Assets with the Surrogate’s Court

• Protect and preserve assets until distribution can take place

• Distribute assets to beneficiaries in accordance with the Will

• Dispose of any remaining property Trustee

• Protect and preserve all assets held under a trust on behalf of the beneficiaries

• Distribute assets to the beneficiaries as directed by the trust Other Duties for either Fiduciary Role

• File estate and/or inheritance tax returns within specific time frame, if necessary

• Ensure final personal and fiduciary income tax returns (if any) are filed with the IRS and state

• Provide accounting of transactions from date of death until distribution to all beneficiaries

If there is a time when you are unable to make your own decisions, who will make financial and health decisions on your behalf?

This is a very important question that many people don't ask or wait too late to ask.

To discuss your specific circumstances and concerns with an experienced attorney, contact Zammitti Law, PLLC to schedule a consultation.